New Delhi, Jan 30: Finance Minister Arun Jaitley will present Budget 2018 on February 1. This will be the last full-fledged budget before the general elections and it is expected that the government may not want to waste this golden opportunity. The Modi government, which has chosen pragmatism over populism in the past, might cut some slack for the common man this time. It is expected that the common man may get some tax reliefs in the upcoming budget. Also Read - Finance Act 2018 Clarifies Applicability of Standard Deduction For Pensioners
The State Bank of India recently said in a report that the government must increase the income tax exemption limit from Rs 2.5 lakh to Rs 3 lakh. This will benefit 75 lakh tax payers. Last year, the Modi government had not increased this limit. But it gave some tax benefit. It is expected that the government might make the tax payers happy. Also Read - List of Things That Will be More Expensive From April 1, 2018
It is also expected that the government might introduce the long-term capital gains tax on stock market transactions. The tax will be levied on transactions above a certain value. The money might go in welfare schemes. Also Read - Armed Forces Facing Shortage of 52,000 Soldiers, Army's 21,000 Posts Vacant: Govt
It is also reported that the government may increase the limit of tax exemption under Section 80 C. Now the government might increase the limit from Rs 1.5 lakh to Rs 2 lakh.
SBI’s Ecowrap report said that if the exemption limit of interest payments under housing loan is increased from Rs 2 lakh to Rs 2.5 lakh, the dent to the exchequer will be a paltry Rs 7,500 crore but 75 lakh people will benefit from the move.
The report said that the tax interest on term deposits may be raised from the current annual limit of Rs 10,000 per annum. The lock-in period for tax-saving fixed deposits should be reduced to three years from five years currently.
Experts believe the government might allow more money to the middle class to save and invest. The government might also want to spur growth by promoting public spending.